May 2021 Monthly News Roundup

We are pleased to share with you our roundup for May 2021. This month we explore branded digital worlds emerging as the new marketing terrain. 

The public and private markets continued to thrive in May with three main IPOs across the consumer packaged goods and retail sectors. On the Tuesday after its initial debut, Honest Company, the consumer goods brand founded by Jessica Alba sold 25.8 million shares at $16 each, valuing the company at $1.44 billion. Oatly, the oat-based dairy substitute brand backed by industry heavyweights including Blackstone and Oprah Winfrey, opened 30% above its initial public offering price of $17, valuing the company at $13 billion. FIGS, the medical scrubs brand creating stylish and functional workwear for medical professionals, is unique in its approach to IPO as it is the first company to offer some of its IPO shares to retail investors via Robinhood before it officially debuts on the market. This month, some of the most noteworthy deals included South Korean e-tailer, Musina's acquisition of StyleShare, Authentic Brand Group and SPARC's acquisition of Eddie Bauer, Future's acquisition of Marie Claire from Hearst, Barnes & Noble's acquisition of Paper Source, Walmart's acquisition of virtual fitting room startup Zeekit, and private equity firm Regent's acquisition of Ralph Lauren's Club Monaco. Notable investments this month included: the digital Saks ($465M), cultured meat company Eat Just ($170M), hospital-at-home concept Huma ($130M), brand marketplace Ankorstore ($100M), fitness ring maker Oura ($100M), period underwear Knix ($43.5M), Chinese multi-brand streetwear retailer Knowin ($31M), and fertility technology company Alfie Health ($9.5M).

Branded Digital Worlds Emerging as the New Marketing Terrain  

The creation of metaverses is accelerating and every week presents more opportunities for growth, investments, and collaborations centered on brands entering these collective virtual shared spaces. As gaming platforms capitalize on pandemic-fueled popularity to their platforms, brands that drive culture are making moves to ensure that their digital identities are equally as captivating as their physical counterparts. The efforts to go into branded digital worlds highlight heightened efforts to capture new audiences via gaming channels and digital platforms. This month, many examples emerged of megabrands in the fashion and beauty industries focusing their efforts on this new space. Gucci partnered with Roblox to present "Gucci Garden", a two-week initiative on the Roblox platform which pairs a set of Gucci's digital branded items with a set of virtual spaces, a digital event curated to coincide with the real-world event in Florence, Gucci Garden Archetypes. For luxury fashion brands, entering the digital world has presented many areas of concern surrounding the preservation of exclusivity. However, Gucci's increased focus on digital platforms shows its mindset in promoting a more inclusive brand that reflects the times and how consumers are engaging with content and brand messaging post-pandemic. Similar to Gucci, P&G-owned skincare giant, SK-II, sought to provide a differentiated experience online and launched its own digital world modeled after SimCity, named SK-II City. SK-II City, built by SK-II Studios and digital marketing agency Huge, allows users to visit iconic Japanese destinations, watch films created by SK-II Studios, and explore behind-the-scenes footage of beauty campaigns. This new feature is a permanent fixture on the site and the brand will continue to build upon it to eventually add virtual stores that allow consumers to purchase products via the digital world. Similar to the efforts fashion and beauty brands are taking to enter the digital marketing worlds and grow direct engagement with new audiences, the International Olympic Committee (IOC) announced this month that it was organizing an Olympic Virtual Series, an initiative that features esports competitions in auto racing, baseball, cycling, rowing, and sailing.

This increased focus on digital is a direct response to changing consumer behaviors and the many investments in this space point to how brands are looking for unexpected ways to enhance how consumers shop, explore, and learn. Investments in the metaverse space this month include Avatar startup Genies ($65M), which aims to bring more artists into the metaverse as 3D avatars. Genies intends to use the funds to bring more celebrities into the metaverse and build out Genies’ NFT Marketplace to allow users to trade tokenized avatars, clothing, and accessories. In the music industry, Warner Music Group acquired a stake in Wave, an LA-based company that transforms performers into digital avatars in a virtual environment, where they can play live-streamed concerts and events. The Trust, a commercial department at the Wall Street Journal, also ventured into this space by launching "The Field", its' first virtual reality storytelling experience build in partnership with Active Theory. The experience at The Future of Everything Festival allows attendees to dive into multi-sensory stories and interact with one another via VR headsets, desktop, and mobile devices. 

Brands that have experimented with gaming are also beginning to explore NFTs, non-fungible tokens, and the value of ownership in the fashion and art industries. Recently, luxury luggage brand, Rimowa, announced that it is creating a collection of NFTs designed for the metaverse. In addition, a Hong Kong-based digital fashion brand known for creating NFT sneakers and other collectibles, RTFKT Studios, raised $8M in seed funding from venture capital firm Andreessen Horowitz to incubate new digital community projects and grow its expanding partnerships with individual artists. As culture-shaping brands continue to set their sights on acquiring new digital assets, the growth of metaverses and luxury's impending NFT revolution becomes undeniable. 

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